SunSirs: China PET Prices Fell in early September, Hitting a New Low in 2024

https://www.chemnet.com   Sep 10,2024 SunSirs

According to the Commodity Market Analysis System of SunSirs, the price of PET water bottles continued to decline this week. As of September 9th, the average market price has been adjusted to 6,362 RMB/ton.

In terms of the raw material market, a series of core economic data released last week appear quite bleak, triggering deep concerns among investors about the weakening of the growth momentum of US consumer spending, and subsequently leading to a pessimistic attitude towards the growth prospects of US oil consumption demand. At the same time, there are multiple negative news coming from the market: the possibility of Libyan crude oil supply returning to the international stage, as well as expectations that OPEC+ organizations may start increasing oil production, these factors are intertwined, exacerbating the unfavorable macro atmosphere. Affected by the continuous negative macro news, international crude oil prices experienced a sharp decline this week, which directly put heavy pressure on the polyester sector and led to its overall weak performance. As of September 8th, the average price of PTA in China was 5,012 RMB/ton, a decrease of more than 800 RMB/ton from the average price of 5,830 RMB/ton in the East China market on August 1st, which failed to provide effective cost support for the PET market. The cost support of PET is average, market demand is weak, and trading activity has significantly decreased, which in turn has led to a further decline in the focus of PET futures and spot prices.

On the supply side, on the one hand, there are significant expectations for the expansion of new production capacity, including the upcoming production of the 750,000 ton/year project of Xingye Plastics and the 500,000 ton/year project of Yizheng Petrochemical. In addition, three sets of equipment that were originally under maintenance are expected to restart, and it is expected that PET supply will increase significantly in September. On the other hand, with the high temperatures in summer and the end of student holidays, people's travel activities have significantly decreased, directly affecting the consumption of terminal soft drinks and catering industries, thereby reducing the demand for PET materials. The pessimistic market atmosphere has further intensified the downward pressure on the polyester bottle chip market, with prices frequently falling. Under the risk of continuously shrinking inventory value, industry participants generally adopt more conservative strategies and are more cautious in placing orders, resulting in a significant slowdown in order volume growth. At the same time, the increasing number of trade barriers worldwide has also set new obstacles for the export of polyester bottle flakes, making it difficult to reach new highs.

In summary, the current PET market has a sharp supply-demand contradiction, with increased supply and weak demand, coupled with export obstacles, putting heavy upward pressure on the absolute price of the PET market. The market trend tends to be cautious and unstable.

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